DHAKA, 7th April, 2016 (WAM) – The government of Bangladesh today signed a $217 million financing agreement with the World Bank’s International Development Association (IDA) to upgrade a unit in the Ghorashal power station, which will increase the unit’s existing electricity generation capacity by more than double.
The Ghorashal Unit 4 Repowering Project will transform a gas-fired steam unit that is currently generating 170 MW into an energy efficient 409 MW plant. Such conversion to combined cycle technology will increase the plant’s overall efficiency from existing 30% to 54% while requiring only 18% more natural gas, the World Bank said in a press release.
“Bangladesh can grow its economy much faster and reduce poverty significantly if its energy infrastructure can meet the demand for reliable, low-cost electricity,” said Rajashree Paralkar, World Bank Acting Country Director for Bangladesh. “The project will increase the efficiency in gas utilization of an existing unit, while adding new generation capacity to address the country’s severe power needs.”
The project will also reduce the specific fuel consumption per gigawatt hour by 44% and lower greenhouse gas emissions. In addition, the project will provide capacity building and institutional support to the Bangladesh Power Development Board.
“The government has prioritized improving the efficiency of gas-based power plants, given the shortages in natural gas production,” says Kazi Shofiqul Azam, Additional Secretary, Economic Relations Division, government of Bangladesh. “The repowering of the Ghorashal Unit 4 will quickly add new generation capacity without adding major infrastructure costs for fuel supply.”
The agreement was signed by Kazi Shofiqul Azam and Rajashree Paralkar on behalf of the government and the World Bank, respectively, at the Economic Relations Division.
With this credit, the World Bank’s total support to the country’s power sector passes $1.7 billion. In FY 16, the World Bank committed over $773 million in new financing in Bangladesh. The credit from IDA has a 38-year term, including a six-year grace period, and a service charge of 0.75 percent.